Bioenergy: impact of rural development support measures in Latvia

The Latvian RDP 2007–2013 targets renewable energy production from biomass of agricultural and forestry origins, where a total investment of EUR 45 million is predicted; besides, there are also additional opportunities for support of renewable energies in the farm modernization measures. The purpose of the study presented in the paper is to evaluate the support under the RDP 2007-2013 measures provided for the bioenergy production in Latvia by studying its tools, results and impacts. The main materials used for the studies are as follows: published and unpublished  data from Central Statistical Bureau of Latvia (CSB) and Latvian Rural Support Service (RSS). The results show the support granted to biogas plants has been significant as it constituted almost half of the total support paid to the rural economic diversification measures in Latvia by 2014. Moreover, biogas plant projects were realized by the wealthy agricultural producers and are located in most productive agricultural Latvian regions, which contradict the aim of RDP. Despite the rapid increase in the amount of biogas (bioelectricity) produced, mainly due to the generous public support, as well as the fast development of the production of biomass (fuelwood), the total bioenergy consumption in Latvia is still below the target. Furthermore, the development of fuelwood production mainly contributes to meeting the RES targets in other countries, not Latvia, as it is mostly export oriented. JEL codes: O13, Q28, Q42, M21.